Vietnam industrial real estate needs to encourage industrial cluster model

Commenting on Vietnam's real estate real estate market, Troy Griffiths, Deputy General Director of Savills, said that industrial real estate in Vietnam should promote the development of a separate industrial cluster model to increase competing capability.

According to Troy Griffiths in highly industrialized countries, the development of separate auto industry clusters becomes important. This way of working helps to bring about better operating efficiency because the steps in the production process are located close to each other and synchronized. The value of focusing on cluster development has been recognized for separate industrial sectors, allowing provinces or regions with low competitiveness to develop and compete more effectively. At the policy level, centralizing areas by industry also benefits the tenants better, rather than the context of separate and scattered industries across the country.

Many domestic and international real estate investors are now targeting industrial land because of the potential that this type of real estate offers. Factors such as global trade, geopolitics and infrastructure development contribute to changing the nature of industrial real estate in Vietnam. Adding to that is the disruption characteristic of the modern logistics and retail industry, thereby creating a very interesting development context for industrial real estate.

Vietnamese industrial real estate is highly appreciated for its potential and opportunity for development. Artwork: Vietnam Plus

Assessing the localities with strong potential for developing industrial clusters, Mr. Troy Griffiths said that Hai Phong is a locality that is developing auto industry segment. With favorable infrastructure being gradually completed, close to major markets, Hai Phong will be an outstanding industrial locality. In addition, Da Nang is also a market that converges all the prerequisites for developing high-value industrial real estate. Besides, Long An has the advantage of low rents and will benefit from connecting Ben 3 belt. Particularly, Binh Duong, due to its close connection with Ho Chi Minh City, has been recording a rapid increase in land prices, which has also increased the value of land in the surrounding areas.

The future of the industrial real estate market lies in the direction of high value industries or industries in sector 3 of the economy, which are service industries. New international players entering the market are familiar with cluster-focused development, as this is a common phenomenon in their former industrial markets. Industrial clusters by industry will be driven through government policies, corporate income tax incentives and strategic planning. From there, the economic impact of industrialization will be spread across the country instead of focusing on a given area.

According to Phuong Uyen